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 A Washington veteran with a reputation as a hard-nosed infighter, Panetta lost battles with Attorney General Eric Holder, first over the release of long-classified interrogation records and, then late last month, over Holder's decision to investigate some agency officials involved in Bush-era interrogations of terror detainees.
The Obama administration's decisions to overrule Panetta's attempts at protecting the agency's secrets and some of its personnel spurred a report that the CIA chief threatened to resign.
But intelligence officials close to Panetta insisted Friday that he is not going anywhere, saying he retains a comfortable perch in Obama's inner circle.
"The stories that have been out there about shouting matches and threats to resign are wrong, pure and simple," said CIA spokesman Paul Gimigliano.
According to one senior intelligence official, several senior Obama administration officials told Panetta at the White House this week that the spy agency's work was vital and appreciated.
According to the official, who spoke on condition of anonymity because he was not authorized to reveal internal White House discussions, administration officials felt the assurance was necessary to offer in the wake of Holder's controversial Aug. 24 decision to investigate whether CIA interrogators broke laws against torture during the Bush administration.
Tension between the two agencies, officials said, built up over the summer as Holder mulled the decision and peaked once he had made up his mind.
The senior intelligence official said that Panetta urged Holder several times not to appoint a prosecutor, opposing any reopening of cases because lawyers from the Bush administration's Justice Department had already made the decision five years ago to decline prosecutions.
In Panetta's view, the official said, those issues had already been decided, and the review would be a distraction for the CIA.
Panetta again called Holder the morning of the Aug. 24 announcement and the two men had a brief conversation, the official said. Despite several subsequent news reports that the conversation grew heated and was laced with obscenities, the official backed Gimigliano's account that there were no curse words or arguments. Panetta had a simple message for Holder, the official said, asking that the probe be narrowly focused and as short-lived as possible.
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 On that front, Panetta has been satisfied, according to the official. Holder assigned the review to John Durham, who is nearly two years into an investigation into the CIA's destruction of interrogation videotapes. Little information, if any, has leaked about that probe, and Durham was not given the wide-ranging investigative powers of a special prosecutor.
Several Washington veterans who have observed Panetta say he accepted a thankless mission from Obama
- point man for a president intent on tightening a leash on the CIA after its officials spearheaded harsh interrogations and secret prisons during the Bush era.
"Seeing how he has handled it, he hasn't been flawless. But given the CIA being attacked by a Democratic Congress particularly on the House side I'd be hard-pressed to think of a better guy to lead this agency," said Fran Townsend, President George W. Bush's former homeland security and counterterrorism adviser.
Sen. Dianne Feinstein, D-Calif., who heads the Senate Intelligence Committee, gives Panetta high marks for navigating very rocky shoals so far.
"Leon Panetta has a strong internal compass," she said in a statement to The Associated Press. "It's true that he's had a learning curve, but all evidence indicates that he has weathered that learning curve. I believe he is a good, sound manager and administrator for the CIA."
She echoed CIA statements that Panetta has no intention to resign.
[Associated
Press; By PAMELA HESS]
Copyright 2009 The Associated
Press. All rights reserved. This material may not be published,
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